When Members of an Oligopolistic Industry Agree to Collude, Raising

question 219

Multiple Choice

When members of an oligopolistic industry agree to collude, raising their product price substantially above average cost, the passage of time (months and years)

• A) is usually needed for the members to solidify their cooperation.
• B) usually results in finer control of prices and markets by the group and larger profit margins.
• C) is likely to erode the agreement, as ways to cheat are developed by some participants and new entry is encouraged by the high price.
• D) seldom has any impact on the agreement, as long as the participants maintain high profit levels as a result of the agreement.

Recognize the ethical implications of withholding or delaying bad news.

Know the goals of negative communication and apply them to construct effective messages.

Compose negative messages using language that respects the reader’s feelings and dignity.

Utilize sensitivity and clarity to help readers accept and move past bad news.

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Definitions:

Short-term Obligations

Financial liabilities that are due within one year, typically including accounts payable, short-term loans, and other debts.

Creditors

Individuals or institutions that lend money or extend credit to others and are owed repayment in the future.

Pro Forma Financial Statement

Financial reports that project the future income, assets, and liabilities of a company, often used in planning and decision-making.

Financial Condition

Refers to the status of an entity's financial health, often evaluated through its assets, liabilities, and equity.